Addressing labour and skills shortages in a fast-changing economy

Caroline Klein and Jonathan Smith

No 1811, OECD Economics Department Working Papers from OECD Publishing

Abstract: The Danish labour market is strong, but tensions have increased since the pandemic. The post-pandemic recovery boosted labour demand, but structural factors, such as late labour market entry by the young, changing skills requirements and obstacles to the recruitment of migrants, contribute to persistent shortages and impact the wider economy. Lowering the effective tax rate on labour income could reduce disincentives to higher working hours and to moving from part-time to full-time employment. Adapting the workplace to an ageing population and adjusting early retirement schemes could help to extend working lives. Targeting the tenth grade to students with greater learning needs, reducing student allowances and introducing an income-contingent loan system for master’s students could also encourage faster entry into the labour market. There is room to increase the recruitment of foreign-born workers, as well as improving their integration. The demographic, digital and green transitions will transform jobs and skills requirements, demanding an agile education and training system throughout the working life. Encouraging vocational education and training, notably by facilitating mobility between vocational and academic tracks, would ensure strong skills in areas where workers are lacking.

Keywords: Denmark; education; gender; labour market; migration; pension; skills; taxation (search for similar items in EconPapers)
JEL-codes: I28 J16 J20 J24 J26 J60 M53 (search for similar items in EconPapers)
Date: 2024-07-25
New Economics Papers: this item is included in nep-age, nep-lma, nep-mac and nep-mig
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1787/757311cb-en (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oec:ecoaaa:1811-en

Access Statistics for this paper

More papers in OECD Economics Department Working Papers from OECD Publishing Contact information at EDIRC.
Bibliographic data for series maintained by ().